Doing business in California can be a lucrative endeavor, but it comes with a cost. The American Tort Reform Association has consistently labeled the state as the country's top “judicial hell”, where companies are often forced to avoid lawsuits. The State of California has a website designed to help entrepreneurs start their business step-by-step. It also provides assistance with international trade and serves as a hub between small businesses and additional resources.
The five major industries in the state are finance, insurance, real estate, renting and leasing; professional and business services; government and government companies; information; and educational services, health and social care. Businesses operating in California must pay sales and use taxes on transactions. While they can make more money in the state, the cost of doing business is higher than elsewhere. The City of Orange requires that all commercial, industrial and residential businesses that operate or are headquartered in the City obtain and maintain a current business license.
Small businesses make up 99.8% of all businesses in the state and employ 48.8% of the workforce, making them an essential part of the Golden State economy. Researchers from the Rose Institute for State and Local Government at Claremont McKenna College, in collaboration with the economic development consultancy Kosmont Companies, based in El Segundo, conducted a survey to determine which cities are most expensive for businesses to operate in. The survey revealed that Los Angeles County is more costly than Orange, San Bernardino or Riverside counties when it comes to doing business. In addition to taxes and fees, businesses must also consider the costs imposed by the California Environmental Quality Act (CEQA). This law needs renovation but is still a major factor when it comes to doing business in the state. To start a business in California, you must submit an application with all required ownership information and pay the appropriate fees. The goal of Orange County is to make it a safe, healthy and satisfying place to live, work and play for current and future generations by providing outstanding and cost-effective regional public services.
However, there is a large income disparity in the state which puts low-income Californians at risk of being excluded from markets and having fewer available dollars to spend on goods and services for small businesses.
